Project
of Ukrainian Federation of Informatics

Project "Computer Modeling System 'Ukrainian Budget'"

Year - 2002

Purpose and objectives: Multi-functional modeling system "Ukrainian Budget" is intended for solving a vast variety of tasks of budget and finance forecasting and macroeconomic analysis under the conditions of transition economy to support decisions on development of state economic policy.

Main points: Continuation of works performed by V.M. Glushkov Cybernetics Institute of the National Academy of Sciences of Ukraine in co-operation with scientific-research and economy-oriented higher educational institutions on modeling macroeconomic processes in transition period. The principal novelty of the project lies in simultaneous consideration of several pricing mechanisms peculiar to different economic forms and in combination of balance and econometric dynamic macromodels within the scope of imitating modeling complex, thus enabling application of system approach to analyzing the processes occurring in the fields of production and money circulation when shifting to market economy.

Customer: The work has been performed on an initiative basis.

Project Manager: Doctor of Physics and Mathematics, Professor Mykhailo Mykhalevych.

Primary results:

• Models of inflation processes in transition (highly monopolized by branch) economy were developed and examined. This analysis helped determine the disproportions between macroeconomic and inter-branch indicators most influencing the mentioned processes.
• Dynamic macromodels of economic systems with monopsonic labor market and partially competitive goods market were constructed and examined. It was shown that aggregate demand and supply in such systems either stabilizes at a certain level with no further growth, or changes on a cyclic basis with trends to overall decline. The role of inflation processes in formation of the said cycles was determined.
• Models of crisis phenomena in money circulation under the condition of decline in transition economy were worked out and examined. It was shown that under such conditions the payment crisis is a hidden form of expenses inflation brought about by structural and technical disproportions.
• Modeling complex "Budget" was created on the basis of the above models and imitating model of state budget execution using a system approach. The complex structure and the system of transition economy models are shown correspondingly in Fig. 1 and 2 (see Appendix).

• forecasting of the state budget execution;
• analyzing the cross-impact of state budget structure, primary taxation norms, tariff and customs policy and dynamics of macroeconomic values;
• forecasting (branch-detailed) price development, profits and losses of manufacturers and consumers for the current year;
• analyzing short-term consequences of applying different approaches to price management;
• estimating the effect of changes in currency exchange rates on volumes of export, import and domestic manufacturing of the most important products;
• forecasting of the scope and branch structure of non-payments given the defined price dynamics;
• optimizing inter-branch model for determining the rational export and import structure given limited resources and external markets was developed. Calculations on real data were made, thus inviting formulation of proposals on improving the structure of foreign trade relations of Ukraine. A stochastic investment priority change model on condition of changes in investment profitability and national currency exchange rates was proposed and analyzed.